"So in my case I have a Roms Folder. In that folder I have a folder named "Nintendo - Wii". And in that folder I have individual .iso files for each game I have. " Sorry, but that's not what I've told you.
So the basics: A set is a collection of roms/chds/samples. Pacman for example in MAME consists of 10 roms (IC dumps of the program roms, the graphic roms, the proms etc).
When you talk about a Nintendo - Wii collection, each set most likley consist of 1 rom file..where rom is a wrong word here, it's an ISO file. So your Nintendo - Wii datfile most likely contains some hundred sets where each set contains of 1 file.
Now back to the general storing method:
rompath\setname\file 1 ... file n for decompressed sets
rompath\setname.zip (.rar/.7z) (where the archive holds files belonging to the set) for compressed sets
Assuming your got "e:\test\Nintendo - Wii" as a rootfolder for your collection, then *this* is your rompath.
Your sets are either compressed, then you can put them zipped/rared/7zed in there, e.g. "e:\test\Nintendo - Wii\exampleGame.zip" (where exampleGame is the setname and the archive holds an iso file, e.g. named test.iso)....or your sets are not compressed, then you need to store it: "e:\test\Nintendo - Wii\exampleGame\test.iso"
So, look in your datfile and check how sets are organized. If you got 1000 sets with each set containing just one iso file, then you end up with 1 rompath holding 1000 subfolders where each one holds 1 iso file...
If your datfile holds just 1 set with 1000 iso files, then you end up with 1 rompath holding 1 folder holding 1000 iso files.